OPERATIONS

Tesco’s CEO-in-waiting to continue global expansion push

BY CSA STAFF

Deerfield, Ill. On Tuesday, British supermarket mogul Tesco PLC announced a successor to retiring CEO Sir Terry Leahy, and the naming of the incoming chief suggests that aggressive global expansion for the world’s third-largest retailer will continue.

According to a Wednesday report by the Wall Street Journal, when Tesco’s Europe and Asia leader Philip Clarke takes the reins from Leahy next March, Tesco will continue its global march, especially in emerging markets.

Leahy is credited with expanding Tesco’s international footprint from five countries to 13. Clarke’s role in the push was overseeing the retailer’s debuts in emerging markets such as China, Turkey and India. Also, under Clarke’s leadership, Tesco bought 36 hypermarkets in Korea in 2008 and announced plans to open wholesale outlets in India, the first of which rolls out this fiscal year, according to the WSJ report. Tesco is also supplying wholesale merchandise in India to Tata Group’s Star Bazaar supermarket.

Clarke’s primary challenge now is to build larger-scale businesses in China, the United States and India.

“The potential market in those countries can give growth for decades,” Christopher Hogbin, retail analyst at Sanford C. Bernstein & Co., told WSJ. “The primary focus is absolutely developing the businesses that they have, so they get scale and good returns in those markets.”

With Tesco’s struggles in the United States, where its Fresh & Easy chain has been stymied by the housing crisis, movement into this country could prove a major challenge for Clarke, who will be supported by a new management structure that creates regional chief executives throughout the world. Retail and logistics director David Potts will take over as the first CEO of the Asian business and commercial director Richard Brasher will become CEO of the United Kingdom and Ireland. Tim Mason, president of Fresh & Easy in the United States, will continue to run U.S. operations and add duties as deputy CEO of Tesco.

All three were considered contenders to succeed Leahy, according to the report.

The new structure, Clarke said, “recognizes the shift to international and growth in Asia.”

Tesco’s international sales are expected to double in the next five years, Natalie Berg, research director at London-based consultancy Planet Retail, told WSJ. “Tesco has been the most successful foreign retailer expanding overseas because it has been much more flexible in adapting its store formats,” she said.

Clarke’s success will also depend on continued strong performance in the United Kingdom, where the retailer is entering the services sector with Tesco Bank and attempting to up its share in nonfood products.

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Macy’s celebrates Pride month

BY CSA STAFF

NEW YORK (Jun. 2) Macy’s announced that it has celebrating Pride month with a multitude of in-store fashion events, advertising support, special tribute windows in select stores, gift registry booths for same-sex couples in key cities, as well as sponsorship and employee participation in Pride parades across the country.

"We are proud to support our LGBTQ employees and consumers through initiatives that recognize and honor our commitment to diversity and inclusion," said Corliss Fong, Macy’s vice president of diversity strategies. "Macy’s remains a steadfast supporter of inclusiveness in all aspects of our business and we join in celebration with millions across the nation who live with pride and joy this June."

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Borders announces exec changes

BY CSA STAFF

ANN ARBOR , Mich. (Jun. 4) Borders Group announced that Mike Edwards has been appointed president of Borders Group and president and CEO of Borders Inc., the principle subsidiary of Borders Group. Bennett LeBow, who recently became chairman of the Borders Group board of directors, will serve as CEO of Borders Group. Edwards will report to LeBow.

Edwards has been interim CEO of Borders since January. He joined the company in September 2009 as EVP and chief merchandising officer. Before joining Borders, he most recently served as president and CEO of Ellington Leather, a Portland, Ore.-based leather handbags and accessories wholesaler. From 2004 through 2007, Edwards was president and CEO for lucy Activewear, a division of VF Corp. He has also held executive management positions in merchandising and operations with Jo-Ann Stores, West Marine Inc., Golfsmith and CompUSA, as well as buying and merchandising posts with Target and the May Department Store Company.

LeBow, who recently made an equity investment of $25 million in Borders through an entity he controls, is chairman of the board of Vector Group, a company he’s been affiliated with since 1986. In March of 1996, under his leadership, Liggett Company, owned by Vector Group, became the first tobacco company to settle smoking-related litigation. Before devoting himself completely to private business in 1968, LeBow served in the Pentagon initially as a First Lieutenant and subsequently as a civilian, serving as assistant to the assistant vice chief of staff of the U.S. Army.

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